Item 9A. Controls and Procedures
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), means controls and other procedures of a company that are designed to provide reasonable assurance that information required to be disclosed by a company in the reports it files or submits under the Exchange Act is recorded, processed, summarized, and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the company’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures at January 31, 2022, the last day of the period covered by this Annual Report on Form 10-K. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, at January 31, 2022, our disclosure controls and procedures were effective at the reasonable assurance level.
Management’s Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of January 31, 2022 based on the guidelines established in the Internal Control-Integrated Framework (2013 framework) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Our internal control over financial reporting includes policies and procedures that provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with GAAP. Based on the results of our evaluation, our management concluded that our internal control over financial reporting was effective as of January 31, 2022.
In accordance with guidance issued by the SEC, companies are permitted to exclude acquisitions from their final assessment of internal control over financial reporting for the first fiscal year in which the acquisition occurred. Our management’s evaluation of internal control over financial reporting excluded the internal control activities of SimpleNexus, LLC, which we acquired on January 7, 2022, as discussed in Note 7 "Business Combinations" of the Notes to the Consolidated Financial Statements. We have included the financial results of SimpleNexus, LLC in the consolidated financial statements from the date of acquisition. SimpleNexus, LLC accounted for approximately 1.3% of total assets as of January 31, 2022 and 1.4% of revenues and 7.3% of net loss for the fiscal year ended January 31, 2022.
The effectiveness of our internal control over financial reporting as of January 31, 2022 has been audited by Ernst & Young LLP, an independent registered public accounting firm, as stated in its report which is included in Part II, Item 8 of this Annual Report on Form 10-K.
Changes in Internal Control over Financial Reporting
There was no change in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the fiscal quarter ended January 31, 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations on the Effectiveness of Controls
Our management, including our Chief Executive Officer and Chief Financial Officer, do not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that
100
Table of Contents
breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the controls. The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.
Item 9B. Other Information
Not applicable.
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
PART III
Item 10. Directors, Executive Officers and Corporate Governance
The information required by this Item 10 is incorporated by reference from the sections entitled “ Proposal One: Election of Class II Directors Named in this Proxy Statement ,” “ Corporate Governance ,” and “ Executive Officers ” from our Proxy Statement relating to our 2022 Annual Meeting of Shareholders which will be filed with the SEC within 120 days of the fiscal year ended January 31, 2022 .
Item 11. Executive Compensation
The information required by this Item 11 is incorporated by reference from the sections entitled “ Compensation Discussion and Analysis ,” “ Compensation Committee Report ,” " Executive Compensation, " and “ Compensation of Directors ” from our Proxy Statement relating to our 2022 Annual Meeting of Shareholders which will be filed with the SEC within 120 days of the fiscal year ended January 31, 2022.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The information required by this Item 12 is incorporated by reference from the sections entitled “ Security Ownership of Certain Beneficial Owners and Management ” and “ Equity Compensation Plan Information ” from our Proxy Statement relating to our 2022 Annual Meeting of Shareholders which will be filed with the SEC within 120 days of the fiscal year ended January 31, 2022.
Item 13. Certain Relationships and Related Transactions, and Director Independence
The information required by this Item 13 is incorporated by reference from the sections entitled “ Certain Relationships and Related Party Transactions ” and “ Director Independence ” from our Proxy Statement relating to our 2022 Annual Meeting of Shareholders which will be filed with the SEC within 120 days of the fiscal year ended January 31, 2022.
Item 14. Principal Accountant Fees and Services
The information required by this Item 14 is incorporated by reference from the sections entitled “ Principal Accountant Fees and Services ” and “ Pre-Approval Policy ” from our Proxy Statement relating to our 2022 Annual Meeting of Shareholders which will be filed with the SEC within 120 days of the fiscal year ended January 31, 2022.
101
Table of Contents
PART IV
Item 15. Exhibits and Financial Statement Schedules
1. Financial Statements. See Index to Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K.
2. Financial Statement Schedules
Schedule II Valuation and Qualifying Accounts
Deferred Tax Assets Valuation Allowance
Fiscal Year Ended January 31,
($ in thousands) 2020 2021 2022
Balance, beginning of period $ 33,121 $ 36,425 $ 70,056
Increase during the year 3,304 33,631 38,965
Balance, end of period $ 36,425 $ 70,056 $ 109,021
Schedules not listed above have been omitted because they are not required, not applicable, or the required information is otherwise included.
3. Exhibits
102
Table of Contents
EXHIBIT INDEX
Incorporated by Reference
Exhibit Number Description of Exhibit Form File No. Exhibit Filing Date Filed Herewith
2.1+ Agreement and Plan of Merger, dated as of November 16, 2021, by and among nCino, Inc., Penny HoldCo, Inc., Dollar Merger Sub, Inc., Penny Merger Sub, LLC, SimpleNexus, LLC, Insight Venture Partners, LLC, and the other parties thereto
8-K 001-39380 2.1 November 17, 2021
3.1 Amended and Restated Certificate of Incorporation
8-K12B 001-41211 3.1 January 10, 2022
3.2 Amended and Restated Bylaws
8-K12B 001-41211 3.2 January 10, 2022
4.1 Form of Common Stock Certificate
X
4.2 First Amended and Restated Investors’ Rights Agreement, dated February 12, 2015, as amended, among nCino, Inc. and certain holders of its capital stock.
S-1 333-239335 4.2 June 22, 2020
4.3 First Amendment to First Amended and Restated Investors’ Rights Agreement, dated May 25, 2016, among nCino, Inc. and certain holders of its capital stock.
S-1/A 333-239335 4.3 July 6, 2020
4.4 Second Amendment to First Amended and Restated Investors’ Rights Agreement, dated November 23, 2016, among nCino, Inc. and certain holders of its capital stock.
S-1/A 333-239335 4.4 July 6, 2020
4.5 Third Amendment to First Amended and Restated Investors’ Rights Agreement, dated July 31, 2017, among nCino, Inc. and certain holders of its capital stock.
S-1/A 333-239335 4.5 July 6, 2020
4.6 Fourth Amendment to First Amended and Restated Investors’ Rights Agreement, dated January 16, 2018, among nCino, Inc. and certain holders of its capital stock.
S-1/A 333-239335 4.6 July 6, 2020
4.7 Fifth Amendment to First Amended and Restated Investors’ Rights Agreement, dated July 12, 2018, among nCino, Inc. and certain holders of its capital stock.
S-1/A 333-239335 4.7 July 6, 2020
4.8 Sixth Amendment to First Amended and Restated Investors’ Rights Agreement, dated September 16, 2019, among nCino, Inc. and certain holders of its capital stock.
S-1/A 333-239335 4.8 July 6, 2020
4.9 Seventh Amendment to First Amended and Restated Investors’ Rights Agreement, dated September 30, 2019, among nCino, Inc. and certain holders of its capital stock.
S-1/A 333-239335 4.9 July 6, 2020
4.10 Assignment and Assumption Agreement, dated January 7, 2022, by and among nCino, Inc. and nCino OpCo, Inc., with respect to the First Amended and Restated Investors’ Rights Agreement, dated as of February 12, 2015, by and among nCino, Inc. and certain Investors
8-K12B 001-41211 4.1 January 10, 2022
4.11 Description of Capital Stock
X
10.1† nCino, Inc. 2014 Omnibus Stock Ownership and Long Term Incentive Plan and related form agreements.
S-1 333-239335 10.1 June 22, 2020
10.2† nCino, Inc. 2019 Amended and Restated Equity Incentive Plan and related form agreements.
S-1/A 333-239335 10.2 July 6, 2020
10.3† nCino, Inc. Employee Stock Purchase Plan.
S-1/A 333-239335 10.3 July 6, 2020
103
Table of Contents
Incorporated by Reference
Exhibit Number Description of Exhibit Form File No. Exhibit Filing Date Filed Herewith
10.4† Amended and Restated Employment Agreement with Pierre Naudé.
S-1/A 333-239335 10.4 July 6, 2020
10.5† Amended and Restated Employment Agreement with David Rudow.
S-1/A 333-239335 10.5 July 6, 2020
10.6† Amended and Restated Employment Agreement with Joshua Glover.
S-1/A 333-239335 10.6 July 6, 2020
10.7++ Partner Application Distribution Agreement by and between Salesforce and the Company, dated June 19, 2020, as amended.
S-1 333-239335 10.7 June 22, 2020
10.8† Form of Indemnification Agreement entered into by and between nCino, Inc. and its directors and executive officers.
S-1/A 333-239335 10.8 July 6, 2020
10.9† Form of Assignment and Assumption Agreement entered into by and among nCino OpCo, Inc., nCino, Inc., and its directors and executive officers relating to each applicable Indemnification Agreement
X
10.10† Form of Assignment and Assumption Agreement entered into by and among nCino OpCo, Inc., nCino, Inc., and its executive officers relating to each applicable Executive Employment Agreement
X
10.11 Office Lease by and between nCino, Inc. and Cloud Real Estate Holdings, LLC, dated November 29, 2020.
8-K 001-39380 10.1 December 2, 2020
10.12 Amendment to Office Lease by and between Wilmington Investors LLC and nCino, Inc., dated November 25, 2020
8-K 001-39380 10.2 December 2, 2020
10.13 Agreement Regarding Exercise and Assignment of Purchase Option among nCino, Inc. and Cloud Real Estate Holdings, LLC, dated November 29, 2020
8-K 001-39380 10.3 December 2, 2020
10.14 First Amendment to Office Lease by and between nCino, Inc. and Cloud Real Estate Holdings, LLC, dated January 27, 2021
10-K 001-39380 10.12 March 31, 2021
10.15 Lease by and between nCino, Inc. and Cloud Real Estate Holdings, LLC, dated April 5, 2021
8-K 001-39380 10.1 April 7, 2021
10.16 Second Amendment to Office Lease by and between nCino, Inc. and Cloud Real Estate Holdings, LLC, dated April 5, 2021
10-Q 001-39380 10.1 June 2, 2021
10.17+ Restrictive Covenant Agreement, dated as of November 16, 2021, by and among nCino, Inc. and the Insight Parties thereto
8-K 001-39380 10.1 November 17, 2021
10.18++ Parking Deck Rent Adjustment Notice
10-Q 001-39380 10.2 December 1, 2021
10.19 Credit Agreement by and among nCino, Inc., nCino OpCo, Inc., certain subsidiaries of nCino, Inc. as guarantors and Bank of America, N.A., dated February 11, 2022
8-K 001-41211 10.1 February 14, 2022
21.1 List of subsidiaries of nCino, Inc.
X
23.1 Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm
X
31.1 Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
X
104
Table of Contents
Incorporated by Reference
Exhibit Number Description of Exhibit Form File No. Exhibit Filing Date Filed Herewith
31.2 Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
X
32.1* Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
X
32.2* Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
X
101.INS Inline XBRL Instance Document X
101.SCH Inline XBRL Taxonomy Extension Schema Document X
101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document X
101.DEF Inline XBRL Extension Definition X
101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document X
101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document X
104 Cover Page Interactive Data File (embedded within the Inline XBRL document) X
+ Certain schedules and exhibits to this agreement have been omitted pursuant to Items 601(a)(5) of Regulation S-K, and the Company agrees to furnish supplementally to the Securities and Exchange Commission a copy of any omitted schedule and/or exhibit upon request.
† Management contract, compensatory plan or arrangement.
++ Portions of this exhibit have been redacted in accordance with Item 601(b)(10)(iv) of Regulation S-K.
* The certifications furnished in Exhibit 32.1 and 32. 2 hereto are deemed to accompany this Annual Report on Form 10-K and will not be deemed "filed" for purpose of Section 18 of the Securities Exchange Act of 1934, as amended, except to the extent that the registrant specifically incorporates by reference.
Item 16. Form 10–K Summary
Not applicable.
105
Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
nCino, Inc.
Date: March 31, 2022 By: /s/ Pierre Naudé
Pierre Naudé
President and Chief Executive Officer; Director
(Principal Executive Officer)
Date: March 31, 2022 By: /s/ David Rudow
David Rudow
Chief Financial Officer and Treasurer
(Principal Financial Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed below by the following persons on behalf of the registrant in the capacities and on the dates indicated.
Signature Title Date
/s/ Pierre Naudé President and Chief Executive Officer; Director
(Principal Executive Officer) March 31, 2022
Pierre Naudé
/s/ David Rudow Chief Financial Officer and Treasurer
(Principal Financial Officer) March 31, 2022
David Rudow
/s/ Jeanette Sellers Vice President of Accounting
(Principal Accounting Officer) March 31, 2022
Jeanette Sellers
/s/Steven Collins Director March 31, 2022
Steven Collins
/s/ Jon Doyle Director March 31, 2022
Jon Doyle
/s/ Jeffrey Horing Director March 31, 2022
Jeffrey Horing
/s/ Pam Kilday Director March 31, 2022
Pam Kilday
/s/ Spencer Lake Director March 31, 2022
Spencer Lake
/s/ Jeffrey Lunsford Director March 31, 2022
Jeffrey Lunsford
/s/ William Ruh Director March 31, 2022
William Ruh
106